For the sake of uniformity, simplicity and good order, it is desirable to follow the domestic system of numbering by all organisations that have a responsibility to report their financials to the Indian public at large
Though in India we use English language in all our business communications, in so far as writing of numbers is concerned, we mostly use the Indian system in our daily life. Even in our schools and colleges Indian systems of numbering is generally taught, and this is generally the norm in all financial reporting of facts and figures. However, as there appears to be no guidelines in this regard so far, we find that a few organisations and institutions still publish their statistics in English system, which might cause some amount of confusion while interpreting the figures, particularly if we are not well versed in the English system.
For example, the exact way of writing Indian and English numbers is as under:
The Indian numbering system is written differently and sounds differently too when it reaches six digits. The positioning of ‘coma’ in written form is slightly different between the two systems as seen above.
The Central Government publishes all its statistics in the Indian system in lakhs and crores, and in all its annual budgets too, the figures are mentioned as per the Indian system. All the public sector organisations publish their reports using only the Indian system of numbers, so also all the public and the private sector banks in the country.
The Securities & Exchange Board of India (SEBI) follows only the Indian system of numbers in all its statistical reports and other communications. Only while referring to the foreign investment flows and with regard to statistics relating global depository receipts (GDRs) and American depository receipts (ADRs), that they naturally refer to the English system of millions and billions, as it is stated in foreign currency, mostly in US dollars.
However, in the absence of clear cut guidelines from SEBI, some of the listed companies, particularly those having foreign parentage, publish their quarterly and annual reports using the English system of numbers, though majority of the companies use only the Indian system.
RBI is the lone exception:
The only exception is Reserve Bank of India (RBI), which has been publishing most of its reports on banking statistics using only the English system with figures mentioned in millions and billions. Sometimes, we even see casual press releases and other communications of RBI mention the figures in the English system. The last annual report as on 30 June 2014 of RBI submitted to the Government contains most of the banking statistics in rupees but this is expressed using English system i.e. in millions and billions. This system of publishing the reports in English system may be derived from the British era as RBI was set up during the British rule. In fact the first two Governors of RBI were British nationals. Sir Osborne Smith was the first Governor of RBI from 1 April 1935 to 30 June 1937 and was followed by Sir James Braid Taylor who continued as Governor till 17 February 1943. Possibly the English system of numbering started during their tenure is continuing even today in RBI, though all subsequent Governors of RBI are Indians. Sir CD Deshmukh was the first Indian Governor from 11 August 1943 to 30 June 1949.
However, almost all the banks both in the public and private sector publish their quarterly and annual reports using only the Indian system.
Need to educate our children in both the numbering systems:
Recently, during the summer camp of high school children, one of the teachers asked questions on English numbering system, which many children were not aware of. It is not their fault as English system of writing numbers may not taught in most of the schools at present. But one of the parents is said to have commented that it was too much for children to learn so many different systems followed in different countries. Contradicting this, another parent is reported to have said that if our children can learn three languages from their early age, it should not be difficult for them to learn both the numbering systems simultaneously.
With globalisation of Indian economy, there is ample scope for our people to participate in the global trade. In fact, it is estimated that India will have surplus manpower of four to five crores over the next decade, and India is expected to be the biggest supplier of workforce to the world in the coming years. It is, therefore, necessary for our youth to be prepared to tackle global challenges. Obviously, it is advantageous for our children to be equipped with certain amount of general knowledge on global finance at least at the post secondary level of education, if it is not done already.
Standardising all reports under the Indian system is helpful for general public:
Notwithstanding what is stated above, in the interest of standardising all the statistical information and to maintain uniformity in financial communications, it is desirable that RBI too follows the Indian system in all its publications, particularly when the figures are in rupees, thereby making it easy and simple for the public to interpret the figures released by all institutions in our country. RBI, if it so desires, can always publish their reports in two separate formats, one using the Indian numbers for the Indian public and the other using the English numbers for the use of foreign Central banks, who might prefer to read in their own system.
SEBI too may issue guidelines that all listed companies should publish their quarterly and annual reports using Indian system of numbers, though they are free to publish such reports in their own websites under both the Indian and English systems for the benefit of their foreign partners and investors,
Though conversion from one system to another is quite easy, for the sake of uniformity, simplicity and good order, it is desirable to follow the Indian system of numbering by all organisations that have a responsibility to report their financial performance to the Indian public at large.
(The author is a financial analyst, writing for Moneylife under the pen-name ‘Gurpur’.